What Does Your Small Business Sell?
#007 A GOVCON SB sells professional services in a manner that is cost effective, competitive, and reliable!
Professional Services can be described as Knowledge based, human capital, or Advisory and Assistance Services (A&AS) defined as “relates to tasks that require the application of detailed processes or technical knowledge” according to the Defense Acquisition University.
Cost effective, competitive, and reliable all describe your company’s ability to conduct active program management at the corporate level. It encompasses the ability to understand how to manage a program such as meeting deliverables, quality, timelines, understanding the customer’s mission, customer relationships, and retention (i.e. corporate engagement, employee benefits, and competitive salaries). As we have discussed in previous newsletters, this also includes your ability to control your wrap rate(costs) to facilitate SB growth, enable timely staffing, and effective invoicing.
Staffing Models to drive SB Growth
As a professional services company, your goal is to provide robust recruiting and management capability to find and hire billable employees, reliably! The government is seeking knowledge services at a competitive market average cost point (WRAP) to best meet the Statement of Work (SOW) objectives and accomplish the deliverables. GOVCON is so immense, with overwhelming and constantly changing regulations, that you will always need to be continually learning or updating your knowledge.
As you create your business model, you need to build out a sustainable and cost-effective staffing model to hire the correct personnel or Labor Categories (LCATS), as seen in the below graphic.
Your staffing model is an on-going process for goals such as:
Pro-actively forecasting, monitoring, managing, and updating staff requirements (LCAT analysis)
Continually assessing current staff against future needs
Training and development
Job rotations
Promotion opportunities
Ensuring we deliver maximum value to customer throughout a contracts period of performance (POP)
Accommodating surges and lulls in labor demand i.e. maintaining a candidate pipeline which will improving recruiting effectiveness and timeliness.
Improving staff retention
It Takes a Team(ing)!
Let’s pivot now to how and why your staffing model is one of the factors and so important to growing your business through the teaming process! The government and partners (Prime/sub relationships) are focused on staffing strategies at several stages in the acquisition process. The government needs to know, in the proposal, if the company awarded the work can acquire qualified personnel in a timely manner during the POP.
A teaming agreement is issued when a partner is identified that will complement the large business’ unique capabilities and enhance their ability to offer the best combination of performance, quality, cost, and delivery to the government. The LB issues a TA after determining a strategy or rationale for the selection of each specific SB.
When it comes to a Teaming Agreement (TA) strategy with a Large Business (LB) prime, they are considering several things during the BD, Capture, and Proposal process. Your SB staffing strategy drives both cost and risk. Additionally, the LB is considering whether the competitive advantage your SB offers, justifies the added management burden and the reduction in the LB workshare. Some best practices from the Shipley include:
Make teaming decisions early in the capture process, but not too early! This should include a Small Business strategy and plan.
Develop teammate selection criteria, based on gap analysis from a prior or draft SOW.
Consult with customers about team formation and what they are seeking.
Negotiate a common vision as the basis for teaming, reflected in the TA
Establish a management structure with clear lines of authority
Determine workshare strategy in advance of teaming
Separate decisions about workshare and team management
Address issues before they destroy the team
Teaming Timeline Expectations
Below are some phased expectations. Most companies, large or small, conduct similar activities. When working with a larger business, this is important to keep in mind as this may be a slow moving acquisition process!
Remember, while the FAR stipulates the policy of the Government to provide “maximum practicable opportunities” in its acquisitions to Small Businesses, Small Disadvantaged Businesses, HUBZone, Women-Owned, Veteran-Owned and Service-Disabled Veteran-Owned Small Businesses ((FAR 19.201(a)), this is not the only reason to add your company to a team. Refer to our previous newsletter on how to create and show your company’s value outside of your small business set aside and you are more likely to grow your small business!
Prime contractors must provide evidence of good-faith efforts to comply with its subcontracting responsibilities within its Subcontracting Plan. ((13 CFR 125.3 (d)(3)) Both the government customer and a prime contractor will evaluate your company’s ability to be cost effective, competitive, and reliably staff positions, QUICKLY!